Question 1. What is balance of payments? Explain its major components. Why is it useful to compute a country’s balance of payments?

Question 2. a) Discuss the advantages and disadvantages of gold standard.

b) What were the objectives of Bretten woods system?

Question 3. Define transaction exposure. How is it different from economic exposure? Discuss and compare transaction exposure using the forward market hedge and. money market hedge?

Question 4. Discuss the sources of long term external finance for MNC’s. How do they differ from those of domestic companies?

Question 5. What is counter trade? Discuss the various forms of counter trade. What are the pros & cons of counter trade from firm’s point of view.

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